Compliance
What You Should Know About the New Filing Form for Natural Persons’ VAT Withholding
China has introduced a new declaration form for domestic units withholding VAT for natural persons, effective from November 1, 2026—an important shift for payroll, freelance, and services payments.
By NomadicTax Research Team • 5-8 min read • September 16, 2026
## Overview of the Policy Change
China’s tax authorities released **国家税务总局公告2026年第19号**, an announcement setting out the **template and requirements** for the new VAT & surcharge withholding declaration form concerning **natural persons’ VAT** by domestic entities. This follows the related “Management Measures” (公告2026年第28号), defining when domestic units acting as payers must withhold VAT from natural persons.([fgk.chinatax.gov.cn](https://fgk.chinatax.gov.cn/zcfgk/c102416/c5250801/content.html?utm_source=openai))
## Effective Date & Scope
- **Effective Date**: November 1, 2026.([fgk.chinatax.gov.cn](https://fgk.chinatax.gov.cn/zcfgk/c102416/c5250801/content.html?utm_source=openai))
- **Scope**: Domestic units (e.g. companies, institutions) that make payments to natural persons for services, goods, or other VAT-applicable transactions must now withhold VAT and surcharges. They must use the **new declaration form** titled "境内单位代扣代缴自然人增值税及附加税费申报表" plus attached supplemental material.([fgk.chinatax.gov.cn](https://fgk.chinatax.gov.cn/zcfgk/c102416/c5250801/content.html?utm_source=openai))
## Key Requirements & Filing Mechanics
- The declaration form covers:
* Basic payer (扣缴义务人) information: name, taxpayer identification (统一社会信用代码), period of withholding.([fgk.chinatax.gov.cn](https://fgk.chinatax.gov.cn/zcfgk/c102416/c5250801/content.html?utm_source=openai))
* Details of taxable transaction with natural person: amount, tax base, applicable VAT rate.
* Calculation of the VAT and surcharge tax, e.g., urban maintenance and construction tax, education surcharge, etc.([fgk.chinatax.gov.cn](https://fgk.chinatax.gov.cn/zcfgk/c102416/c5250801/content.html?utm_source=openai))
* Supplemental attachments (附列资料) specifying surcharge breakdown.
## Practical Impact & Advice
- **Domestic businesses** that contract with freelancers, consultants, delivery workers, or even purchase services from individual persons must updated internal accounting, payroll, and awarding contracts to capture VAT withholding obligations.
- **Natural persons** should ensure invoices are issued correctly and identify the unit withholding them to keep transparent records for their own filings.
- Entities must adapt their accounting systems/software to generate this new form and ensure payments align with withholding schedules.
- Non-compliance may lead to audit risk, penalties, or interest charges for late remittance.
## Broader Context
This measure is part of China’s ongoing **VAT Law** reforms, streamlining how VAT interacts with individual service providers and ensuring the tax net covers high-volume transactions that were under-reported in the past. Advisory firms like Deloitte observe this also helps with fairness in tax administration.
## Summary
The new withholding and reporting form kicks in on **November 1, 2026**. For employers and payers, it's time to revise contracts, implementing clear VAT withholding with natural persons. For self-employed individuals, retaining proof and clarity around payments is more important than ever.